Brexit Opportunities Unit

Lord Frost Excerpts

Monday 19th July 2021 Lords Chamber

[The Minister of State, Cabinet Office (Lord Frost) (Con)]

My Lords, the Cabinet Office has advertised the post of director of the Brexit opportunities unit with a salary range of £93,000 to £120,000. That is within the Cabinet Office’s pay scale of £93,000 to £162,500 for a director-level appointment and appropriate for the calibre of candidate that the role requires. The director of the unit will lead an ambitious programme of reform and address many of the most important questions facing the UK.

[Lord Adonis (Lab)]

My Lords, I am thinking of applying for this job because it is such an exciting opportunity. I would be prepared to do it for nothing; I was wondering what the Minister might think of my application. May I give him my pitch for the job? The biggest opportunity for the director of the Brexit opportunities unit is the opportunity to reapply to join the single market and the customs union so that we can eliminate trade barriers with the European Union, eliminate the need for any trade barriers north-south or east-west in respect of Northern Ireland and extend once again to the British people the great opportunity to be able to travel, study, work, settle, live and form relationships across the whole of their continent and not be locked up in Boris Johnson’s Brexit Britain. Does the Minister find that an exciting prospectus?

[Lord Frost (Con)]

My Lords, I thank the noble Lord for his job application. Of course, it is open to him to apply if he wishes, although it will not be for me to judge whether he meets all the criteria for the job. It will not surprise him to know that I disagree with his assessment of where we stand as a country. Brexit will be hugely in the interests of everybody in this country as we take forward the exciting opportunities to reform our rules, take back control of our legislation and run our country as we wish.

[Lord Moylan (Con)]

My Lords, quite in contrast to the noble Lord, Lord Adonis, I see one of the great opportunities of Brexit as the opportunity to diversify our trade away from its artificial and risky dependence on the European Union. In that light, can my noble friend the Minister say what plans the Government have to sponsor and support new and existing industry-led export promotion agencies, which can help in hunting down sales around the world?

[Lord Frost (Con)]

My Lords, my noble friend is absolutely right to set out the trade opportunities now available to this country after leaving the EU. I and many of my Cabinet colleagues work closely with industry organisations of all kinds to help them in their export plans, understand any difficulties that they face and resolve those difficulties. We continue to do that expeditiously.

[Baroness Quin (Lab) [V]]

My Lords, I urge the Minister to look favourably on the application of my noble friend Lord Adonis. In contrast to the noble Lord, Lord Moylan, the Prime Minister claimed that his deal—the TCA—would allow our companies and exporters to do even more business with our European friends. Will it be part of the job of the Brexit opportunities director to achieve increased trade with our nearest and biggest market, particularly in the light of the disruption and loss of trade that we have seen over recent months?

[Lord Frost (Con)]

My Lords, we support expanded trade of all kinds wherever it is to be found. We are confident that British industry will be able to deliver on that. The figures for exports so far this year show that exports to the EU are back to normal—that is, at 2019 levels—which is what we expected. The opportunities for this country as a trading country are very great, and I am sure that it will be part of the role of this individual to get behind them.

[Viscount Waverley (CB)]

My Lords, will the Minister ensure that central government works as a single unit over a common set of objectives? Somewhat in the same vein as the question asked by the noble Lord, Lord Moylan, will he also ensure, building on a strategy of free trade and tariff-free access to our markets from emerging and frontier markets, maximum commercial and political buy-in from those Governments to reinforce the global Britain vision? If he agrees, what does he have in mind to achieve this?

[Lord Frost (Con)]

My Lords, as one would expect, the Government have a single voice on these questions. We are all focused on the ability to deliver the opportunities of Brexit. It is my job to make sure that many of those things happen with this new director when we appoint him or her. On trade, my right honourable friend the Secretary of State for Trade is focused on the issues that the noble Viscount mentioned. In particular, we have applied to join the CPTPP; we have published our prospectus for that and look forward to continuing those negotiations this year.

[Baroness Chapman of Darlington (Lab)]

One of the problems that the Minister has is that he cannot even guarantee free trade within the United Kingdom at the moment. However, let us be positive. In referring to his new unit, the Minister said that he is fully behind making things happen and is prepared to look at government procurement. I welcome that. He will know that Keir Starmer recently launched a “Buy British” campaign, which included giving more public contracts to British companies and requiring public bodies to report how much they buy from British companies. To ensure that his new unit has an impact and is not all hype, will the Minister back our proposals for a “Buy British” campaign?

[Lord Frost (Con)]

My Lords, the noble Baroness is of course right to underline the importance of procurement reform for our objectives. We have made clear that we wish to take forward a procurement Bill, which will radically simplify the arrangements that we have inherited from the European Union. We are bound by the Agreement on Government Procurement at the WTO as well as any procurement arrangements in our free trade agreements; our procurement policies have to fit within all those agreements.

[Baroness Ludford (LD)]

My Lords, it is surprising that the Government need not just a new director but a whole unit paid for and tasked with searching for Brexit opportunities. For the Minister and his like-minded colleagues, surely these opportunities are self-evident. Can he therefore list those Brexit opportunities for me now—specifically, not with some grandiose global Britain rhetoric—and say whether they are sufficient to outweigh the very specific Brexit losses, such as the difficulty of working in the EU, the hassle in exporting and importing, and the shortage of workers in a range of sectors?

[Lord Frost (Con)]

My Lords, I am very happy to do so. For example, we have already brought in a new points-based immigration system. We have also brought in new arrangements to support our farmers, replacing the common agricultural policy. We are beginning to agree free trade agreements with a range of countries around the world. We have brought in a new global human rights sanctions regime, which has been used extensively. In the Queen’s Speech, we set out future opportunities, including the Subsidy Control Bill, a procurement Bill, the free ports programmes, the Professional Qualifications Bill and a planning Bill. The Chancellor has also set out our road map for future financial services; I could go on. There is a long list of opportunities that we will be able to take advantage of.

[Lord Hain (Lab) [V]]

My Lords, the DUP leader Sir Jeffrey Donaldson claimed this morning on “Good Morning Ulster” that the Northern Ireland Assembly not having any role whatsoever in the operation of the protocol undermined the very standing of devolved institutions in Northern Ireland. What plans do the Government have to give Northern Ireland elected representatives meaningful engagement in and scrutiny of decision-making about the evolution and implementation of the protocol and the trade and co-operation agreement as they impinge on areas of devolved competence?

[Lord Frost (Con)]

My Lords, the day-to-day arrangements in the protocol for the democratic scrutiny of laws in Northern Ireland are democratically anomalous. We have said that before and it is why we had to negotiate the consent arrangements in the Northern Ireland protocol to ensure democratic support, or not, for these proposals. We will be setting out our approach to the Northern Ireland protocol more generally later this week.

[Lord Strasburger (LD) [V]]

While the benefits of Brexit remain so elusive, should we not instead be tackling the serious downsides of the EU trade deal, such as the huge hit to our £111 billion creative arts sector? British performers now face major obstacles to touring in Europe, including prohibitive costs and mountains of red tape. Meanwhile, musicians from Tonga and other third countries can tour freely in the EU. Since their negotiators were so much more successful than ours, should not this new director be recruited from Tonga?

[Lord Frost (Con)]

My Lords, we stand fully behind our great creative industries and support them in touring around the European Union. As is well known, we have launched a campaign in the small minority of member states that do not allow relatively easy touring. We are actively lobbying the member states concerned and will continue to do so, in the hope that they change their arrangements to make them as liberal as ours.

[The Lord Speaker (Lord McFall of Alcluith)]

My Lords, the time allowed for this Question has elapsed.

Post-Brexit Financial Settlement

Lord Frost Excerpts

Thursday 15th July 2021 Lords Chamber

[Lord Moylan]

To ask the Minister of State at the Cabinet Office (Lord Frost) what assessment Her Majesty’s Government have made of the European Union’s consolidated budget report for 2020, which states that the United Kingdom has liabilities of €47.5 billion as part of the post-Brexit financial settlement.

[The Minister of State, Cabinet Office (Lord Frost) (Con)]

My Lords, the Government’s regular update to Parliament on EU finances has been published today by my right honourable friend the Chief Secretary to the Treasury. The Treasury estimates that the current cost of the net financial settlement is £37.3 billion. This remains within the previously published central range. The €47.5-billion figure is an estimate produced on a different basis by the EU for its internal accounts processes.

[Lord Moylan (Con)]

My Lords, these are large sums—larger even than those we were discussing yesterday when we discussed the cuts to overseas aid. It appears that the EU is the final arbiter of what we should pay. I understand that there are circumstances when you might want to give a trusted friend details of your credit card, including the three numbers of the back, but if that trusted friend is abusing the card, is it not the right policy to cancel it?

[Lord Frost (Con)]

My Lords, it is of course a legal obligation to make the payments to the EU that were agreed in the withdrawal agreement. They were heavily negotiated in some detail at the time, and of course we stand by them. It was a general difficulty, with a very large sums that we were paying to the European Union, that underlaid the referendum vote in June 2016.

[Lord Foulkes of Cumnock (Lab Co-op)]

Surely the Minister is not surprised by this figure, which was predicted not just by the European Union but by the OBR and other organisations. He will recall the campaign that claimed we were paying £350 million a week to the European Union when the reality was less than half that. How can we now believe Ministers in a Government where the Prime Minister is a stranger to the truth?

[Lord Frost (Con)]

My Lords, we are not surprised by these figures. As I said, the details of how they are calculated are set out in the withdrawal agreement in exhaustive detail, through several dozen articles. The question to which the noble Lord alludes has been sufficiently debated. There are different views on this question but what is clear is that, before we left the EU, we were paying very substantial net sums into it.

[Viscount Ridley (Con) [V]]

My Lords, RTE reports that our 2021 payment is to be €6.8 billion whereas, in the latest Budget Red Book, table C.6 on page 97 shows our 2020-21 sum as £10.4 billion—nearly twice as much. The sum for 2021-22 is £11 billion, so the discrepancy is not likely to be due to year-end differences. The difference is several billion pounds, which is a big number by any standard. As Senator Everett Dirksen said 60 years ago:

“A billion here, a billion there, and pretty soon you’re talking real money.”


Can the Minister explain the discrepancy?

[Lord Frost (Con)]

My Lords, I do not think that any of us on this side of the House feels particularly comfortable paying large sums to the European Union, but it is an agreed outcome in the withdrawal agreement and we stand by it. There are differences in the calculation methods between the EU arrangements and ours. For example, their figure does not include all the receipts we will receive in future, there are different ways of forecasting and so on. We are not surprised that there are some differences. What matters is our own calculations and that we are comfortable with the bills when they arrive, which we are.

[Lord Jones of Cheltenham (LD) [V]]

Does the Minister accept any responsibility for failing to negotiate this bill properly, or are he and the Prime Minister unfamiliar with how divorce works?

[Lord Frost (Con)]

This is one of the occasions when I can disclaim direct responsibility for that particular part of the negotiation in the previous withdrawal agreement. I have been known to be a little uncharitable at times about every aspect of the work that was done by my predecessors but, in this case, on the withdrawal agreement, they did a good job. Given the legal framework and commitments, it was always likely that the outcome would be in this broad area.

[Baroness Chapman of Darlington (Lab)]

The Minister negotiated at length to agree a formula for calculating the UK’s contribution. Whatever we think of the amount, there was some degree of transparency in this. In the interests of transparency, can the Minister tell us whether he played any role in advancing the interests of Aquind Ltd, owned by a former Russian executive, in the Brexit negotiations? I would welcome an answer to my letter to him on this important matter, but perhaps he could tell the House now whether he ever raised the Aquind project in negotiations with the EU.

[Lord Frost (Con)]

My Lords, I welcome the noble Baroness to the Front Bench. I look forward to debating such issues with her on what I hope are many occasions in the future. The link between the EU budget and the question she asks is possibly a little tenuous, but nevertheless I am happy to say that I received her letter and obviously will reply shortly. I have never met Mr Temerko and I have no recollection of discussing his business with any Ministers or anybody else. We are establishing what correspondence, if any, there was with me or my office last year, and will reply.

[Lord Balfe (Con)]

My Lords, certain people have tried to make mischief with this figure. What we need—I think we have now had it from the Minister—is a clear statement that we will stand by the agreement that we negotiated. If he can say that, I am sure that it will find favour on both sides of the negotiating table.

--- Later in debate ---

[Lord Frost (Con)]

We certainly stand by the financial agreement that we negotiated in the withdrawal agreement. As I said, it was very carefully negotiated at some length, and of course we stand by it and the payments that are due under it.

[Baroness McIntosh of Pickering (Con)]

My Lords, I am particularly grateful to my noble friend for committing the Government to this legal obligation; that is very welcome. Will he further confirm that the sums of money being discussed in this Question are going towards the Horizon programme, which is in the present spending review, and from which many UK companies will benefit greatly?

[Lord Frost (Con)]

My Lords, yes, these are significant sums, and the sums involved in the Horizon project and programme are also significant. We have a difficulty with the Horizon programme, in that, at the moment, our participation is still being blocked by the EU, even though all the legal processes behind it are in place. We very much hope that that block can be lifted soon and that UK universities and others with an interest can participate in the programme.

[Baroness Hoey (Non-Afl) [V]]

My Lords, just this week, the Minister told the protocol sub-committee in this House that the European Union had dumped 800 regulations on the UK to apply to Northern Ireland without any consultation or prior warning. As the European Union continues to show intransigence and a determination to show no flexibility whatever to the working of the protocol, is it not time for Her Majesty’s Government to hold back any more payment until the European Union shows itself to be more reasonable?

[Lord Frost (Con)]

My Lords, where threats have been made in this process, they have overwhelmingly come from the European Union side, and we regret that. I do not think it would be right for us to hold this legal obligation in hock to progress on the protocol, which is not to say that we do not think the progress on the protocol and implementing it in a pragmatic, proportionate and appropriate way is not important. It is extremely important, but it is not the same thing as the exit bill.

[The Lord Speaker (Lord McFall of Alcluith)]

My Lords, all supplementary questions have been asked, and we move to the second Oral Question to the Minister of State.

Ireland/Northern Ireland Protocol

Lord Frost Excerpts

Thursday 15th July 2021 Lords Chamber

[The Minister of State, Cabinet Office (Lord Frost) (Con)]

My Lords, I have spoken to many businesses and business organisations in Northern Ireland about this issue. The reality is that Northern Ireland’s economic links are overwhelmingly with the rest of the UK, rather than with Ireland or other EU members. The way that the protocol is currently operating means that any economic benefits it may generate for some are more than counterbalanced in general by the barriers it currently creates between Northern Ireland and Great Britain.

[Baroness Ritchie of Downpatrick (Non-Afl) [V]]

Has the Minister met the new Minister for the Economy in Northern Ireland, Invest NI and other promotional agencies, including the Northern Ireland chamber of commerce, and, if not, when will he meet them? Is he aware that in its latest quarterly review, the Northern Ireland chamber of commerce said that 67% of its members believed that

“Northern Ireland’s unique status post EU Exit presents opportunities for the region”

and that 47% believe that

“Northern Ireland’s trading status will present benefits for their business”?

That includes Northern Ireland biggest wine wholesaler, which said in today’s newspaper that business has grown exponentially due to the new trading arrangements.

[Lord Frost (Con)]

My Lords, I have not yet had the pleasure of meeting the new Economy Minister in Northern Ireland, although I expect to do so soon. To be fair, there is a range of opinion on the benefits of the protocol, even in the business community in Northern Ireland. All I can say is that I do not think I have spoken to a representative of that community who has not expressed some concern about the barriers that are placed on movement of goods between Great Britain and Northern Ireland. The degree of concern may vary, but it is always there, and it is a matter of significant concern to us, too.

[Lord Caine (Con)]

My Lords, as one who has consistently pressed for the defects in the Northern Ireland protocol to be remedied, I very much look forward to seeing the Government’s proposals on the way forward next week. Does my noble friend agree that a good start would be to remind the EU of its obligations to ensure that the protocol

“should impact as little as possible on the everyday life of communities in both Ireland and Northern Ireland”,

as well as

“the importance of maintaining the integral place of Northern Ireland in the United Kingdom's internal market.”?

[Lord Frost (Con)]

My Lords, I very much agree with my noble friend’s comments. It is very clear that the obligations set out in the protocol to which he refers are not being fully met at the moment. There clearly is an impact on the everyday life of communities in Northern Ireland, goods are clearly not circulating as freely as they could or should, and we need to find a new balance in this question. We will be setting out our proposals to that effect next week.

[Lord Hain (Lab) [V]]

My Lords, will the Minister clarify the highly charged phrase that he and a director in the Cabinet Office used before the Lords protocol sub-committee yesterday—namely, that the European Union “dropped” 800 new measures on Northern Ireland last week without notice? Are those measures technical amendments to the existing legislative instruments that apply mainly through Annexe 2 to the protocol, or are they new legislative instruments that the EU thinks should apply to Northern Ireland? In either case, can he explain how the Northern Ireland Assembly, as the legislature responsible for implementing them, is being kept informed of such developments?

[Lord Frost (Con)]

My Lords, I do not think that was highly charged language; I think it was an accurate description of the situation when we received a communication containing 600 to 800 pieces of legislation and pages. That is a significant event. New legislation not within scope of the protocol is obviously covered in a different way; this is obviously legislation that is within scope. Technical amendments can of course be quite significant, and the task of assessing that and ensuring that we understand the statute book in Northern Ireland is significant. That is why we should like more warning, more process and more discussion of this matter.

[Lord Dodds of Duncairn (DUP)]

Can my noble friend confirm that the overall balance of benefits and disadvantages of the protocol is tilted against Northern Ireland at present, given that Northern Ireland trades more with the rest of the United Kingdom than with the Republic of Ireland, the rest of the world and the European Union put together, a phenomenal statistic that should always be borne in mind? Does he agree that firm action needs to be taken to deal not only with that trade imbalance but the societal and political instability which also need to be taken into account when one assesses the benefits and disadvantages of the protocol?

[Lord Frost (Con)]

My Lords, the noble Lord makes a very good point. The balance of advantages and benefits in the protocol is not solely economic, although the economic links are clearly very strong with Great Britain. They are to do with society, politics and the sense of identity, which, it seems, has been undermined in places by the operation of the protocol. It is reasonable to take that into account in our overall assessment. Diversion of trade, societal disturbances and so on are obviously very important factors when we come to consider what action is necessary in this matter.

[Baroness Chapman of Darlington (Lab)]

Yesterday, the Minister told the Northern Ireland Sub-Committee that in his view the protocol was causing societal disruption and weakening of identity, as well as trade friction. If he is right, it is vital that Her Majesty’s Government do nothing to make that precarious situation worse. Does he agree that any trade arrangements involving significant relaxation of import checks could make his problems with the protocol harder to resolve, and will he therefore ensure that the impact on communities in Northern Ireland is properly taken into account by his colleague, the International Trade Secretary?

--- Later in debate ---

[Lord Frost (Con)]

We agree, of course, that it is very important that the situation in Northern Ireland remains calm, and we are very glad that it has. Nevertheless, it is clear that there is a high level of political concern about the situation that currently subsists. It is very important that all of us—this Government, the European Union and everybody else with an interest—act to respond to that political difficulty and show that we can respond politically and solve problems that have arisen, rather than suggest that they do not exist.

[Lord Kerr of Kinlochard (CB) [V]]

I am puzzled by the Minister’s reply to the Question from the noble Baroness, Lady Ritchie—it almost sounded as if he is not very proud of his protocol. It seemed to me and to many in Scotland that Mrs Foster had a point when she talked about the best of both worlds. However, looking ahead, there clearly is a problem with the democratic deficit in relation to new EU single-market laws applicable in Northern Ireland thanks to the protocol. How does the Minister propose to mitigate this problem? Does he agree that the Partnership Council and the parliamentary partnership assembly could play some role and will the Government endorse strong Northern Ireland representation in both?

[Lord Frost (Con)]

My Lords, I learned a good deal of what I know of negotiation at the feet of the noble Lord, Lord Kerr, so wherever we have got to is at least in part thanks to his tutelage over the years. On the issue of the parliamentary partnership assembly and the Partnership Council, the parliamentary assembly is, of course, a matter for Parliament. We are in close touch with those involved as to how it should work but its composition is not a matter for the Government, although we obviously strongly support its work. On the institutions created by the withdrawal agreement and the TCA, we seek to ensure that all the devolved Administrations, including Northern Ireland, can participate in the most appropriate way.

[Baroness Suttie (LD) [V]]

My Lords, as the noble Lord, Lord Kerr, has just said, it is a peculiarity of our times that the Opposition Benches are left to defend the imperfect protocol that the Minister himself negotiated. Does the Minister agree with Julian Smith, who said in May this year that Northern Ireland is in a

“unique position … compared to other parts of the UK to maximise two major markets, Britain and the EU”?

Do the Government have an action plan to promote these opportunities for businesses in Northern Ireland?

[Lord Frost (Con)]

My Lords, I obviously have the highest respect for my right honourable friend Mr Smith but the problem with that analysis comes back to the point made earlier that Northern Ireland’s economic links are overwhelmingly with the rest of the UK. A bargain in which there is greater access to a smaller part of the trade in return for difficulties with the larger part is obviously not a bargain that totally stacks up.

[The Lord Speaker (Lord McFall of Alcluith)]

My Lords, the time allowed for this Question has elapsed. We now come to the third Question to the Minister of State and I call the noble Lord, Lord Liddle.

Trade Agreements

Lord Frost Excerpts

Thursday 15th July 2021 Lords Chamber

[Lord Liddle]

To ask Her Majesty’s Government what steps Her Majesty’s Government are taking to ensure future trade agreements (1) are compatible with the terms of the United Kingdom-European Union Trade and Cooperation Agreement, and (2) take into account relevant regulatory changes by existing trading partners and international organisations.

[The Minister of State, Cabinet Office (Lord Frost) (Con)]

My Lords, the trade and co-operation agreement that we have agreed with the European Union does not require us or the EU to align rules with the other party. This ensures that the UK is in control of its own legislation and that we are free to make other free trade agreements around the world. All these trade agreements are capable of accommodating the consequences of regulatory changes by either party, now and into the future.

[Lord Liddle (Lab)]

I thank the noble Lord for his Answer. The purpose of my Question was to explore the priorities and processes that determine the Government’s trade policy. In a way, what I am asking is the mirror image of the replies that he gave on the Northern Ireland protocol. As far as I can see, the Government’s trade policy is focused very much on the Asia-Pacific region, which brings benefits but not terribly big ones by comparison with the overwhelming importance of our trading relationship with the European Union. Do the Minister and the Government’s trade policy recognise that fact and that it will be the case for decades to come? Do the Government take into account that any divergences that we negotiate from EU standards in other trade agreements are bound to cause some friction in the EU relationship? Does he accept that they are going to make the Commission more reluctant to explore—

[Lord Liddle (Lab)]

—the flexibility that he is seeking in the Northern Ireland protocol and does he want to build on the spirit of the trade and co-operation agreement to deepen the trading relationship with Europe?

[Lord Frost (Con)]

My Lords, this is clearly an extremely complicated issue and a lot can be said on the subject. I am not sure that I entirely agree with the noble Lord’s underlying judgment. Our trade with the EU has been falling fairly consistently for a decade or two now. Our trade with Asia is rising. Most people think that that is likely to continue to be the case and that the strategic emphasis on Asia is right. As regards the relationship between our regulation and other countries’ regulation through FTAs, of course there are choices to be made, but they are the same choices that every country in the world engaging in an independent trade policy undertakes. They seem to manage it and I am sure that we will as well.

--- Later in debate ---

[Baroness Ludford (LD)]

My Lords, when granting the data adequacy decision, the European Commission imposed a four-year sunset clause over fears of UK divergence from GDPR standards, especially in transfers of data to third countries. The Government are none the less forging ahead with international agreements on data transfers such as with the US, the trans-Pacific partnership and Asian countries. Their recent digital policy paper envisaged the Information Commissioner having a key role in communicating the benefits of data sharing—there was me thinking that the Information Commissioner’s role was to safeguard privacy rights. Have the Government done an assessment on the dangers that their data policies could pose to the adequacy decision?

[Lord Frost (Con)]

My Lords, we are obviously very pleased that the EU granted us data adequacy last month. We think that that was the right thing to do and a correct reflection of the situation. The EU grants data adequacy to other countries around the world as well which do not operate identical or close analogues to the EU’s legislation. That does not prevent the grant of adequacy. We think that it is entirely consistent with security of data to look at our own ways of doing these things and that is exactly what we are reflecting on.

[Viscount Trenchard (Con)]

My Lords, can my noble friend confirm that the UK does not intend to align its regulations with the EU’s in order to help the situation in Northern Ireland? Does he agree that there are other ways of reducing the administrative controls between Great Britain and Northern Ireland, such as a veterinary agreement based on mutual recognition of underlying product regulations, as the EU has agreed with New Zealand?

[Lord Frost (Con)]

My Lords, I have said it before and I will say it again: we will not align dynamically with the rules of the EU on agri-food or in other areas. That was the approach that we took into the negotiations last year and that is the consistent approach now. My noble friend is absolutely right that there are other ways of doing this and he is absolutely correct to point to an equivalence-based veterinary agreement as the way forward. That is exactly what we have proposed to the European Union and I am very hopeful that we can discuss that at the Specialised Committee created by the withdrawal agreement when it meets on Monday.

[The Earl of Kinnoull (CB)]

My Lords, the free trade agreement between the UK, Norway, Iceland and Liechtenstein was signed on 4 June. This is a most important agreement between friends and trading partners of the UK, yet Parliament to date has had no opportunity to scrutinise it. Does the Minister regret that? Can he tell us when the agreement will be laid before Parliament?

[Lord Frost (Con)]

My Lords, this is a matter for my right honourable friend the Secretary of State for International Trade rather than for me. There are, of course, procedures under the Constitutional Reform and Governance Act, which sets out how such treaties will be considered by Parliament; I think that is the intention. Obviously we welcome the fullest possible debate on the contents of that treaty.

[Lord Udny-Lister (Con)]

The Minister had to sit through some very difficult negotiations and, some would say, a lot of attempted bullying by the EU. Can he confirm that any trade agreements are for the benefit of the UK and will avoid alignment where it is not to our benefit, and that enormous benefits will flow in the course of time from the trade extensions and the deal with Japan, the deal with Australia and now the potential deal with the CPTPP, which begins to be tantalisingly close? Can he assure the House that he will be looking at them and the benefits and not listening to the EU?

[Lord Frost (Con)]

My Lords, my right honourable friend the Secretary of State for International Trade is obviously responsible for most of those negotiations. I am in 100% agreement with her that they offer huge opportunities for this country. The ability to trade freely with a larger number of countries around the world, while setting our own rules in a way that suits us and this economy, will be of huge benefit to us in years to come and we are all looking forward to that.

[Baroness Hayter of Kentish Town (Lab)]

The Minister has admitted that the extra barriers caused by the protocol have had a dampening effect on free trade, but he does not seem to accept that the extra barriers between us and the EU similarly have an effect on the freedom of trade and the amount we will export to the EU, which is still our nearest and biggest market. Indeed, exports of food and drink—our major export industry—fell by 47% and increased by a mere 0.3% outside the EU. We have to continue to trade with Europe. Will he set out how the Government propose to reverse the export fall to Europe?

[Lord Frost (Con)]

My Lords, the noble Baroness is a little over-pessimistic about where things stand at the moment. The latest trade figures, which came out last week, show that our exports to the EU are now well above the average levels of last year and are almost at the levels of 2019 and 2018. Our business has done a great job in dealing with that. I have never sought to hide the fact that leaving a customs union creates new barriers. I am very happy to see that our businesses are dealing with them very successfully. They are different in nature from barriers within a country, and that is the difference between some of the effects that we are seeing with our exports to the rest of the European Union and the chilling effect on trade within the United Kingdom because of the way that boundaries currently operate.

[The Deputy Speaker (Baroness Fookes) (Con)]

My Lords, the time allowed for this Question has elapsed.

Civil Society Forum: UK Delegation

Lord Frost Excerpts

Thursday 24th June 2021 Lords Chamber

[Lord Foulkes of Cumnock]

To ask the Minister of State at the Cabinet Office (Lord Frost) when Her Majesty’s Government expects to establish the United Kingdom’s delegation to the Civil Society Forum set out in the United Kingdom-European Union Trade and Cooperation Agreement.

[The Minister of State, Cabinet Office (Lord Frost) (Con)]

My Lords, we are absolutely committed to working with a broad range of business and civil society groups on the implementation of the trade and co-operation agreement. At the 9 June Partnership Council, we agreed that we and the EU should begin to work and to agree, we hope, on the operational guidelines for the civil society forum in good time so that it can meet this year as required. Obviously, we will draw on the network of business and civil society groups we talk to domestically to make sure we have a balanced representation at that forum.

[Lord Foulkes of Cumnock (Lab Co-op)]

My Lords, in the Minister’s reply to my noble friend Lady Hayter of Kentish Town, which he sent eventually—interestingly, just after I tabled this Question—he did not answer a question that Mr Gove also failed to answer in the other place the other day. Could he now, as the Minister ultimately responsible, give us an assurance that representatives of charities, social enterprises and trade unions will be included on the civil society forum?

[Lord Frost (Con)]

My Lords, we will obviously seek to have a balanced representation on the forum. I would personally be very surprised if that did not include at least some representation for charities, trade unions and the sectors the noble Lord mentioned.

[Viscount Waverley (CB)]

My Lords, the Minister went a long way to addressing my question. However, is not the right messaging that civil society engagement across the board is a key strand that would serve to deepen our relationship with all EU regions by identifying common interests, bringing greater understanding and generally enriching our lives, building on our recent association to include that of Northern Ireland and the Republic, for example? When operational guidelines to the Partnership Council are being determined, will the Government go beyond that of the Brussels-centric forum on interparliamentary exchange and advocate that any civil society networks created be EU-wide and meet on a regular basis, possibly using our APPG movement as a working model?

[Lord Frost (Con)]

My Lords, we will certainly reflect on the issues that the noble Viscount raised. There is, of course, a provision in the agreement for a partnership forum between Parliaments, work on which is also moving forward effectively. It is the nature of civil society that it does not need the Government’s permission to develop such links and to work effectively with fora established under the treaties. We certainly hope that that would happen.

[Lord Adonis (Lab)]

My Lords, it is six months since the noble Lord’s Brexit deal and this institution, like the border arrangements in Northern Ireland, still is not functioning properly and may never do so. Has he had the chance to reflect on the evidence he gave to the Foreign Affairs Select Committee earlier this week, where he said that he could not have been expected to foresee the problems with the Northern Ireland border, only to have the chairman point out that almost everybody else had foreseen them, including the noble Lord, Lord Barwell, who was Theresa May’s chief of staff, and almost everyone who commented on this issue in the House? Does he appreciate that he is coming to look a bit like Anthony Eden in the Suez crisis in perpetrating an escalating crisis, and undermining our foreign policy and our standing in the world, which is apparent to everybody except himself?

[Lord Frost (Con)]

My Lords, obviously I do not accept the conclusion. The noble Lord is oversimplifying what I said at the Foreign Affairs Committee. It is precisely because we knew we had agreed something exceptional, complex and difficult that we built in consent arrangements, and why we had a reasonable expectation of the arrangements operating pragmatically. That has not turned out to be the case. There has turned out to be a very significant chilling effect on Great British businesses moving goods to Northern Ireland. We knew that there would be such an effect. It has turned out to be very much stronger and much more rapid. I do not think there is anything unreasonable in learning from experience when we deal with such a sensitive and delicate situation and trying to find a more reasonable balance as we go forward.

[Lord Moynihan (Con)]

My Lords, given that the civil society forum must bring a wide range of experience to collaborate with government and business leaders in finding and advocating solutions, would my noble friend agree that engagement with civil society representatives from a wide range of experiences, including the recreational and active lifestyle sectors, could benefit government by drawing together expertise from across government and the recreation sector to ensure the success of the recently announced office for health promotion in the Department of Health, which in turn would focus on how an active lifestyle could benefit our population, tackle obesity and mental health challenges, and enable us to emerge stronger as a nation from Covid-19, as well as sharing all our experience with the UK-EU civil society forum?

[Lord Frost (Con)]

My Lords, I certainly agree that the civil society forum, when it is up and running, should seek to draw in as wide a range of expertise and ideas as it possibly can. I certainly agree that it is also important that the Government meet as wide a range of civil society organisations, broadly defined, as possible. I certainly meet business representations weekly from sector to sector. I have met a wide range of civil society representatives in Northern Ireland, and we continue to do so.

[Baroness Hayter of Kentish Town (Lab)]

My Lords, we know that this was discussed at the beginning of the month in the Partnership Council. Indeed, I raised it at the previous Questions to the Minister on 27 May so, as my noble friend just described, it was very nice to get the letter last night. We have a habit of getting letters from Ministers late at night—one of the Minister’s colleagues does the same thing. I know that time might move a bit slowly for the Minister, but can he confirm two things? First, is there beginning to be a list, on paper, about who might sit on the forum? Secondly, does he agree that the domestic advisory group, which should feed into the forum, needs to be up and running before the forum so that that group—in other words, the British section of the forum—can begin meeting, thinking and preparing, so that when it meets its EU counterparts it is equipped to do the job that the forum will be set up to do?

[Lord Frost (Con)]

My Lords, obviously, a prerequisite for moving this forward has been the first meeting of the Partnership Council to kick it off, which happened only two and half weeks ago, so we are in the early stages of identifying the possible UK representatives. It is for departments to do that, and departments are engaging very actively with the civil society groups they meet. Our intention is absolutely to establish a collective capacity on the UK side to begin the discussions with the European Union. We are at rather an early stage of that process.

[Lord Balfe (Con)]

My Lords, Article 14.3, which deals with the establishment of the forum, states:

“Each Party shall promote a balanced representation, including non-governmental organisations, business and employers’ organisations and trade unions”.


I remind the Minister that between one-third and 40% of trade unionists support the Conservative Party and a number support other parties. It is doubtful that the Labour Party even has a majority of TU support these days. Will the Minister ensure that, when the government departments appointing people to UK places are appointing representatives of the trade union movement, they take steps to ensure that they reflect the political balance of the members of trade unions, not just the leadership?

[Lord Frost (Con)]

My Lords, my noble friend makes a very good point about the possible gap between the views of trade union members and the views of those who speak in their name. This has been a feature of British politics for some time. It is absolutely our intention to ensure that the UK component of the civil society forum is balanced in every possible way, so that there is full representation of all shades of opinion and interest.

Protocol on Ireland/Northern Ireland

Lord Frost Excerpts

Thursday 24th June 2021 Lords Chamber

[Lord Thomas of Gresford]

To ask the Minister of State at the Cabinet Office (Lord Frost) what steps he is taking to promote bilateral negotiations with the European Union to facilitate the implementation of the Protocol on Ireland/Northern Ireland.

[The Minister of State, Cabinet Office (Lord Frost) (Con)]

My Lords, the Government are working hard and in good faith to resolve outstanding issues with the Northern Ireland protocol, including by providing the EU with more than a dozen detailed proposals on the way forward. We continue to look to make progress in these discussions, but the situation is now urgent. If we cannot find solutions, we have to consider all options to meet our obligations to support peace, prosperity and stability in Northern Ireland.

[Lord Thomas of Gresford (LD) [V]]

My Lords, in the light of the encouraging report last night that there is a prospect of agreement with the EU on extending the grace period in Northern Ireland in certain areas, can the Minister confirm that the Government have abandoned threats of unilateral action as a fruitless negotiating tactic and intend henceforth to solve problems through the dispute resolution mechanisms agreed within the protocol?

--- Later in debate ---

[Lord Frost (Con)]

My Lords, we continue to discuss the grace period for chilled meats with the European Commission. It is not yet resolved and there are still a number of issues to sort out. We will continue to consider all our options on this or any other matter if we cannot resolve them by consensus.

[Lord Hain (Lab) [V]]

My Lords, why on earth should Brussels, Dublin or Belfast trust him?

[Lord Frost (Con)]

The question of trust is important in these negotiations. Trust is required on all sides. The protocol is, in our view, not being operated in the pragmatic and proportionate way we hoped for when we agreed it. If we are to establish trust between us again, we need to operate it in that fashion.

[Baroness Hoey (Non-Afl)]

My Lords, I know that the noble Lord understands the fragility of the situation in Northern Ireland due to the protocol. I hope that he also understands the feeling that I saw at the rally in Newtownards last week. People feel not just angry but desperately upset and saddened that they have been neglected by their Government. Can the Minister answer what criteria Her Majesty’s Government will use to judge when the protocol is not realising its objective, in Article 1, to protect the Belfast agreement in all its dimensions, not just north/south—which sticks out strongly for the Irish Government—but east/west too?

[Lord Frost (Con)]

My Lords, the question asked by the noble Baroness is obviously a very political one. It is important to bring political judgment to these questions, rather than mechanical criteria. It is clear that we have already seen political turbulence in Northern Ireland and that the delicate balance of the Belfast/Good Friday agreement risks being disrupted. We keep this matter under close review and recognise a clear responsibility to act in support of stability and security in Northern Ireland, if necessary.

[Lord Caine (Con)]

My Lords, earlier this week, the Irish Government said that they would “go the extra mile” to find solutions to the problems caused by the protocol. In welcoming that intervention, does my noble friend agree that it would also help if the Irish Government impressed on their EU partners the extent to which implementation of the protocol is now fuelling political instability in Northern Ireland, and that solutions are urgently needed if we are to avoid the situation deteriorating to the extent that it threatens the institutions established under the 1998 agreement?

[Lord Frost (Con)]

My Lords, I very much agree with the sentiments expressed by my noble friend. We welcome the intervention and statement referred to by the Irish Government; we should all go the extra mile to find solutions to problems. I urge all EU member states to look carefully at the situation in Northern Ireland and consider whether they can support durable and pragmatic solutions to restore the balance in Northern Ireland and support the Belfast/Good Friday agreement. That is certainly what we will be doing.

[Baroness Ludford (LD) [V]]

My Lords, the Minister may have seen that his colleague, the noble Lord, Lord Patten of Barnes, told the Irish Times that the UK Government should “tell the truth” and implement the “legally binding” Northern Ireland protocol, adding that

“the problem at heart is not the sausages you get from Sainsbury’s but the porkies that we all get, home and abroad, from Downing Street.”

Is it not the case that honesty from the Government about what they have negotiated, signed and ratified would be a good start in finding that durable and pragmatic solution to which the Minister just referred, with maximum flexibility?

[Lord Frost (Con)]

My Lords, I have the highest respect for the expertise of my noble friend Lord Patten on Northern Ireland. I read his speech in full this morning; it is extremely interesting. I note that he urges the European Union to show flexibility in some areas, for example areas where we have pressed for flexibility such as the trusted trader scheme and pharmaceuticals. I do not believe that the conclusions he draws from the Brexit process, as it affects Northern Ireland, are correct. It is important that all those commenting on the situation in Northern Ireland show responsibility in the way they do so. If I may say so, the tone of some of his comments in that speech was not entirely consistent with that.

[Lord Robathan (Con)]

My Lords, today is the fifth anniversary of when the British people had the temerity to vote to be free of the restrictions of the EU. Surely it is not beyond the wit of man to arrive at a mutually beneficial settlement on the Northern Ireland protocol, particularly for the people of Northern Ireland and the Republic of Ireland but also for those of Great Britain. What concerns me about these negotiations is whether both sides are negotiating in good faith. I hope my noble friend can reassure me that they are and that the EU is not trying to punish the British people for their determination to leave the EU.

[Lord Frost (Con)]

I give both sides the courtesy of believing that they are negotiating in good faith. I am sure they are but, as I said frequently in the negotiations last year, the European Union spent a bit too much time speculating on our intentions and not looking at actions and what we said. To turn that principle around, we look at the actions of the European Union on Northern Ireland and the things it does and says about the protocol. Those actions and words, in the way we are operating the protocol, cause the difficulties we are facing, so I urge, as we always do, thought about pragmatic and proportionate solutions as the way forward.

[Baroness Wheatcroft (CB)]

My Lords, on 7 November 2019, the Prime Minister said of the Northern Ireland protocol:

“There will be no forms, no checks, no barriers of any kind.”


Can the Minister say how the Prime Minister reached that conclusion?

[Lord Frost (Con)]

At the time, we faced the need to find pragmatic and proportionate ways to implement the protocol in a balanced way, respecting all the dimensions of the Belfast/Good Friday agreement—east-west, as well as north-south. If we are to find a solution, it will be in re-establishing that balance and making sure that east-west trade is subject to as few difficulties as possible, so that the balance in these arrangements can be re-established.

[Baroness Smith of Basildon (Lab)]

My Lords, in answer to an earlier question, the noble Lord, Lord Frost, said that these were matters of political judgment. Indeed, his political judgment brought us the Northern Ireland protocol which he negotiated in the first place. I want to look forward on the subject of how this will work. Has he yet had the opportunity to read the written evidence to the inquiry that our Protocol on Ireland/Northern Ireland Sub-Committee is undertaking? If not, I urge him to do so. I particularly refer him to the submissions from the Northern Ireland Business Brexit Working Group and from Queen’s University, Belfast. If he has not read those, he really must do so, because they look at a pragmatic, best-interests way forward. Surely any judgment is best made on the basis of facts, not just of political views.

[Lord Frost (Con)]

My Lords, I have indeed looked at that evidence. It is extremely interesting in all kinds of ways. Obviously, we talk directly to many of the groups which have submitted evidence. When I look at the views expressed by the business group, I am struck that it recommends solutions which we ourselves have put forward. We have put forward a proposal for the veterinary agreement based on equivalence, for a trusted trader scheme, for arrangements for pharmaceuticals, and so on. I think we have a good common understanding of the problems. The difficulty is in developing a constructive negotiation that gets us towards solutions.

[The Deputy Speaker (Baroness Finlay of Llandaff) (CB)]

My Lords, the time allowed for this Question has elapsed. I apologise to the noble Lords, Lord Dubs and Lord Moylan.

UK and EU Relations

Lord Frost Excerpts

Thursday 24th June 2021 Lords Chamber

[The Earl of Kinnoull]

To ask the Minister of State at the Cabinet Office (Lord Frost) what is the current state of the relations between the United Kingdom and the European Union.

[The Minister of State, Cabinet Office (Lord Frost) (Con)]

My Lords, we are very pleased that the trade and co-operation agreement has entered into force and that its governance mechanisms are operational. This includes the partnership council, which met for the first time on 9 June. There are of course some outstanding issues between the UK and the EU, notably as regards the implementation of the Northern Ireland protocol. Although we want to improve the situation, realistically, things may remain bumpy for a little time. We continue to engage constructively and pragmatically with the EU as a sovereign equal.

[The Earl of Kinnoull (CB) [V]]

My Lords, I thank the Minister for that response. This morning, the European Union ambassador to the UK was a witness before the European Affairs Committee. In his evidence, he talked of the need to raise the mutual level of trust and to improve the quality of co-operation. He felt that it would produce a positive impact on the relationship. Does the Minister agree with this analysis? What are the Government doing to raise the mutual level of trust and improve the quality of co-operation today?

[Lord Frost (Con)]

My Lords, as I mentioned, the governance mechanisms of the trade and co-operation agreement are now operational. The specialised committees will meet in the weeks and months to come. As this process gets going and the teams get into contact and discuss the issues, I am sure that matters at this level of detail will improve. The best way of improving the level of trust between us would be to engage in a pragmatic negotiation on the Northern Ireland protocol. If we can find solutions there, I am sure that things will greatly improve.

[Lord Dodds of Duncairn (DUP)]

My Lords, if everyone is serious about adhering to the Belfast agreement as amended by the St Andrews agreement, we must all agree that it fails the test of cross-community support in Northern Ireland. It undermines the three-stranded approach to the east-west relationship and the constitutional settlement as far as the Assembly is concerned. In bringing forward solutions, which are urgently needed as we approach the summer, does the Minister agree that, as well as the trade friction, the constitutional and democratic flaws at the heart of the protocol need to be addressed?

[Lord Frost (Con)]

My Lords, when one observes the situation in Northern Ireland, there is a clear sense in one community that ties with the rest of the UK risk being weakened. That has the political consequences with which we are very familiar. The situation needs to be dealt with. Consent is extremely important. We recognise the issues of democratic accountability, which is why—unusually—we built arrangements for consent into the protocol. The whole protocol depends on consent. If there are clear doubts about it in either community, in practice it will be very difficult to operate, which is why it is so important to come together to find pragmatic solutions.

[The Earl of Clancarty (CB)]

My Lords, the ability of the arts to work across Europe is an aspect of good relations. The agreements with EEA countries represent a small part of the market for the performing arts. The desire of the music industry for us to have a bespoke visa waiver agreement with the EU remains paramount. Has the Minister seen the agreement which the industry has carefully drafted, and which does not break the commitment to take back control of our borders? If so, will he consider taking this agreement to the EU? I am sure that it would be receptive.

[Lord Frost (Con)]

My Lords, in the negotiations last year we made proposals to try to fix the problems to which the noble Earl refers. They were rejected by the European Union. We were able to agree better arrangements in negotiations with the EEA—with Norway, Liechtenstein and Iceland—which is an indication of what could have been possible. I have seen the proposal for a visa waiver agreement. I do not think it consistent with our requirement to retain discretion over our own immigration arrangements. We are actively working with all the member states to find solutions in how they operate their visas for touring performers to see if we can reduce the burdens that way.

[Lord Wood of Anfield (Lab)]

My Lords, the Minister wears two hats. The first is that of chief negotiator, wherein he rightly calls for trust, pragmatism and compromise. This is the hat of a relationship builder and deal maker. The second hat is that of the Minister for Post-Brexit Affairs, wherein he writes editorials to the Mail on Sunday saying that drastic action may be needed in response to EU intransigence and telling the EU that it needs

“a new playbook for dealing with neighbours.”

Does he understand that there may not be room for both hats? In strongly criticising the EU to a UK audience for political reasons, Lord Frost 2 may be undermining the work of Lord Frost 1, who actually has to work and negotiate with the EU.

[Lord Frost (Con)]

My Lords, I am afraid I do not see the same inconsistency with the two hats to which the noble Lord refers. My approach has been to tell it like it is and to make sure that what we say in these negotiations is what you get. We believe in saying the same in public as in private, so the European Union is not hearing different things in the negotiations from what it may read in the press. These issues are quintessentially matters of political debate. It is perfectly natural to engage in political debate within this country about them, and I do not apologise for it.

[Lord Purvis of Tweed (LD)]

My Lords, the Minister negotiated an agreement with the European Union whereby, from Thursday next week, e-commerce businesses and customers for internal UK trade—which never encroaches on the EU market—will have to apply EU rules, pay EU rates and apply a new VAT system, without any representation at all. Why on earth did he negotiate this?

[Lord Frost (Con)]

My Lords, we are aware of that issue and in discussion with the European Union about it. It is of course consistent with taking back control ourselves that the other party to the treaty also takes back control. That is what the treaty is designed to regulate. We believe that the benefits of having control over our own rules and the opportunities that offers us globally will be best in the long run for this country.

[Baroness Hayter of Kentish Town (Lab)]

It was indeed five years ago today that we got the results of the referendum. For five years I have been at this Dispatch Box. I have done the talks, the Statements, the Bills and Questions to the Ministers: the noble Lord, Lord Bridges, the noble Baroness, Lady Anelay, the noble Lord, Lord Callanan, the noble Lord, Lord True, and now the noble Lord, Lord Frost. In taking my leave of this portfolio this week—and not before time—I am delighted that my noble friend Lady Chapman will hold the Minister’s feet to the fire in future. She is a welcome addition to our Benches. But before I depart, perhaps the Minister could explain to the House how the deal that he negotiated and advised the Prime Minister to sign has led to quite such a “bumpy ride”—his words—and whether he can persuade the Prime Minister to heed Monsieur Barnier’s advice to respect his signature on the withdrawal agreement.

[Lord Frost (Con)]

My Lords, I thank the noble Baroness for our sadly brief but enjoyable co-operation. I look forward to standing here at the Dispatch Box and dealing with her successor. On her question, the difficulty is that we did something pretty exceptional as a country in the withdrawal agreement, which was to agree that goods could be controlled in a particular way as they moved within our own country. Self-evidently that can happen only if it is applied with a degree of delicacy, pragmatism and proportionality, which, unfortunately, we are not seeing. That is the core of the difficulty. If we can re-establish the balance, we shall be able to find a satisfactory way forward.

[Lord Berkeley of Knighton (CB) [V]]

My Lords, I look forward to discussing the problem of musicians touring in Europe at a later date, but there is one specific problem that I will put to the Minister. Will there be some arrangement between the UK and the EU over emergency replacements? Let me give an example: suppose the Royal Opera House is putting on the “Ring” here and Wotan falls ill. As the noble Lord might know, only a handful of singers can sing Wotan in the world. This is analogous with sports as well. Will there be any way to deal with this in the coming months?

[Lord Frost (Con)]

My Lords, I am very familiar with that particular issue. In fact, my last private trip aboard before the pandemic was to see “Das Rheingold” in Berlin. I look forward to such things resuming. I will take away the particular point he mentions. DCMS has established a working group with representatives from across the sectors looking at these particular problems in a high level of detail. I will make sure that that is drawn to the attention of those involved.

[The Deputy Speaker (Baroness Finlay of Llandaff) (CB)]

My Lords, the time allowed for this Question has elapsed. My apologies to noble Lords who were unable to ask their questions. We now come to the third Question to the Minister of State. I call the noble Lord, Lord Foulkes of Cumnock.

Protocol on Ireland/Northern Ireland

Lord Frost Excerpts

Thursday 27th May 2021 Lords Chamber

[Lord Dodds of Duncairn]

To ask the Minister of State at the Cabinet Office (Lord Frost) what steps Her Majesty’s Government will take to prevent any negative impact on Northern Ireland from the Protocol on Ireland/Northern Ireland.

[The Minister of State, Cabinet Office (Lord Frost) (Con)]

My Lords, as I have set out on many occasions, it is clear that the protocol is presenting significant challenges for many in Northern Ireland and across the whole of the UK. Solutions must be found urgently to address these. We remain committed to working through the issues with the EU, and we hope that it will show common sense and take a pragmatic risk-based approach to the problems. We continue to consider all our options in meeting our responsibility, which is also the purpose of the protocol, to protect the Belfast/Good Friday agreement and the peace process.

[Lord Dodds of Duncairn (DUP)]

I thank the Minister for his Answer. In the protocol court case that is being taken in Belfast, the Government have argued, astoundingly, that parts of the Act of Union itself have been impliedly repealed by the protocol. That is an incredible position for a Conservative and Unionist Government to find themselves in. Does the Minister accept that, as well as the serious economic difficulties and diversion of trade being caused by the protocol, this assertion of constitutional vandalism will add immensely to the serious societal difficulties in Northern Ireland, one expression of which is the almost nightly occurrence of peaceful protests in Northern Ireland, which are largely unreported but reflect a widespread dismay at the unbalanced approach to the political and peace process? The Minister talked about solutions. Can he indicate a timetable for solutions that reflects the urgency and gravity of the situation?

[Lord Frost (Con)]

My Lords, obviously I am not able to comment on the specifics of litigation while it is ongoing. I point out that the protocol itself is clear that it is without prejudice and has no effect on the territorial integrity of the UK or its essential state functions. That is a very important element of the protocol.

We understand the dismay and concern about identity that is provoked by the way the protocol is currently being implemented, and we are attempting to respond to that as a matter of urgency. There are a number of timetables in parallel here: the negotiating process, the grace periods themselves and the political timetable in Northern Ireland must all be kept in step if we are to find solutions to these issues.

[Lord Dubs (Lab) [V]]

My Lords, it is fairly clear that the Minister is unhappy with the protocol, or at least the way that it is working out. Will he indicate what the Government’s strategy is for achieving a better outcome regarding the protocol, given that, if neither we nor the EU know what is going on, it is hard to see how we are going to move forward? What is the Minister’s proposal?

[Lord Frost (Con)]

My Lords, the noble Lord is right to observe that we are not particularly happy with the way that the protocol is being implemented. Our hope is that we can find solutions to this with the European Union. I speak frequently to my EU colleague, Maroš Šefčovič, and our teams are in regular touch. Talks are going on semi-continuously on these questions and we hope to have made progress in dealing with some of the most difficult issues by the time of the joint committee, but obviously it takes two sides to move forward and find pragmatic solutions. Progress is limited at the moment but we keep working at it.

[Baroness Suttie (LD) [V]]

What progress, if any, has been made towards achieving an EU-UK veterinary agreement?

--- Later in debate ---

[Lord Frost (Con)]

My Lords, we would have liked, in the negotiations last year, to have established as part of the TCA an agreement on equivalence for SPS and food standards that could have been framed as a veterinary agreement or in other forms, but the EU was not willing to agree such a process. We remain willing to try to do so if it wishes to. What we cannot agree to is dynamic alignment of our rules with those of the EU because it is a fundamental tenet that we must have control of our own laws and rules if we are to do free trade deals and get the full benefits of Brexit. Once again, we keep working to see whether we can find a compromise on this issue that works within both sides’ red lines, but at the moment we are not succeeding in doing so.

[Lord Caine (Con)]

My Lords, does my noble friend agree that it is completely insane that a packet of Sainsbury’s Cumberland sausages destined for its Forestside store in Belfast has to undergo cumbersome checks on entering Northern Ireland from Great Britain due to fears that it might illegally enter the EU single market, when Sainsbury’s does not have a single store in the EU? Could there be a clearer example of the pressing need on the part of the EU to adopt a more sensible, pragmatic and proportionate approach to the implementation of the protocol, and to put an end to this utter madness?

[Lord Frost (Con)]

I certainly agree that it seems curious to us that there needs to be extensive process paperwork as well as the possibility of checks for goods that do not present any risk of moving into the EU’s single market. Obviously we agree that it is important to protect the integrity of the EU’s single market, but that needs to be done on a sensible risk-based basis. It was because of concerns such as this that we had to extend the grace period relating to supermarkets earlier this year, as is well-known, and why we remain concerned that a permanent solution to this problem has not been found yet.

[Lord Empey (UUP) [V]]

My noble friend the Minister will be aware of the report from Marks and Spencer yesterday which revealed the cost to that company of its operations on both sides of the Irish border. This huge, undemocratic and bureaucratic superstructure we have created is surely totally out of proportion to the tiny amount of trade, in European terms, that flows across the Irish border. Will my noble friend and the colleagues he is negotiating with at the EU seriously talk to some people about realistic alternatives that achieve the objective of protecting the single market but do not cause the divisions within the United Kingdom that this protocol has caused?

[Lord Frost (Con)]

My Lords, we looked very closely, obviously, at the report from Marks and Spencer earlier this week and the costs that it has identified as being connected to the protocol. It is important to note that, although it is sometimes said that we are not trying to implement the protocol, in fact both companies and this Government have shouldered very considerable costs trying to do so—both in the private sector and, for us, in the trader support scheme, movement assistance scheme and so on. All of that is having a chilling effect on the ability to move goods across the whole of the UK, which is causing so much difficulty, so we need to find a realistic and lower-cost, risk-based approach to doing this. That is what we hoped to see and we continue to hope that we can agree with the European Union.

[Lord Murphy of Torfaen (Lab) [V]]

My Lords, dialogue is always better than legal writs and newspaper articles, so I welcome the Minister’s recent visit to Northern Ireland to meet businesses and communities. Can he now tell us if he has any immediate plans to meet officials of the European Union, the Irish Foreign Minister Simon Coveney and the leaders of all the political parties in Northern Ireland to discuss these difficult issues around the Northern Ireland protocol?

[Lord Frost (Con)]

My Lords, I remain in contact with all those whom the noble Lord has suggested that I should be in contact with. I talk to my European Union opposite numbers frequently—in fact, I had a meeting with the EU ambassador this morning. I remain in close touch, as does my right honourable friend the Secretary of State for Northern Ireland, with all ranges of opinion in Northern Ireland.

[Baroness Hoey (Non-Afl) [V]]

My Lords, the protocol is causing immense harm to peace and stability in Northern Ireland, as well as to businesses and consumers. However, now people all over the UK are angry about the ridiculous EU rules on pets traveling from Northern Ireland to GB and from GB to NI. What message would the noble Lord give to Christopher, who is a 13 year-old boy in County Fermanagh who helps train dogs for search and rescue? He is a champion at dog trials but now, because of the cost and bureaucracy of travelling back taking his dog, he will not be able to attend dog trials any more. There are rabies injections, worming and pet passport paperwork, which are all needed each time he takes his dog from one part of the UK to another. The EU is clearly not listening to the people of Northern Ireland, nor cares about the people of Northern Ireland. Does the Minister? I know he does, so when will the Government recognise that the EU does not care and just pull the plug on this protocol?

[Lord Frost (Con)]

My Lords, this is a good example of a problem that we saw no reason should arise when the protocol was negotiated but has nevertheless arisen. We are concerned about the difficulties in moving pets from Great Britain to Northern Ireland and in the other direction. The EU has it in its power to deal with this problem by giving us part 1 listing for pets as it does for many other countries and for which dynamic alignment is not required. We had assumed that this would be what happened; unfortunately, it has not been granted to the UK. We have part 2 listing and that is why the problems persist. It remains in the EU’s power to change this situation if it wishes.

[The Deputy Speaker (Lord Faulkner of Worcester) (Lab)]

My Lords, the time allowed for this Question has elapsed.

UK-EU Trade and Co-operation Agreement: Regions and Industrial Sectors

Lord Frost Excerpts

Thursday 27th May 2021 Lords Chamber

[Lord Purvis of Tweed]

To ask the Minister of State at the Cabinet Office (Lord Frost) whether Her Majesty’s Government still plans to commission an impact assessment of the United Kingdom–European Union Trade and Cooperation Agreement on regions and industrial sectors when the economy returns to normal.

[The Minister of State, Cabinet Office (Lord Frost) (Con)]

My Lords, the Government routinely publish a wide range of analysis on the UK economy and will continue to do so as appropriate. Many bodies, such as the OBR, also regularly publish economic analysis on the impact of our trade deal with the EU. All this contributes to the public debate in this area. We keep this matter under review, but meanwhile we will continue to take full advantage of the opportunities available to us as an independent trading nation.

[Lord Purvis of Tweed (LD)]

My Lords, the ONS publication on Tuesday this week detangled the impacts of Covid and the impacts of the TCA by comparing quarter 1 2021 figures with quarter 1 2018 figures—the last period in which

“relatively stable trade patterns were observed.”

Non-EU trade for the UK fell by 0.8% over that period; EU trade fell by an enormous 23.1%. That shows clearly the difference between Covid-19 and the TCA. How can the Minister explain the difference in that fall?

[Lord Frost (Con)]

My Lords, I read the ONS report with interest. It confirms the position on trade, which I have set out on several occasions before: that there are a number of factors prevailing here. It is true that 2018 may well have been the last full year of normal trading conditions, but we are still in a pandemic. Economies have not returned to normal, so it is not entirely surprising that trade figures have also not returned to normal at the moment.

[Baroness Neville-Rolfe (Con)]

My Lords, perhaps the most pressing issue facing the country, other than Covid, is discerning the best way forward post Brexit, economically and in other ways. Whether drawing up an impact assessment would be the most helpful method is doubtful in this case. However, does my noble friend the Minister agree that a full evaluation of the new opportunities that he has mentioned is now essential?

[Lord Frost (Con)]

My Lords, I agree with my noble friend that there are huge opportunities from Brexit, and we are taking those forward as set out in the Government’s legislative programme: a subsidy control Bill, a procurement Bill, a National Insurance Contributions Bill, a freeports programme and so on. These are all huge opportunities. It might be premature to do an immediate evaluation of the effect of all those before they have been introduced and brought into force, but of course impact assessments will go with the necessary legislation in this area.

[Lord Liddle (Lab)]

My Lords, I am sure the Minister is well aware of the excellent work of the Centre for European Reform under its director, Charles Grant. I would like his reaction to the latest report authored by its distinguished economist John Springford, published on 12 May, about the first quarter of trade data. The conclusion is that

“leaving the single market and customs union had reduced UK trade by 11 per cent in March 2021. That is on top of a 10 per cent hit to trade between the referendum and leaving the single market.”

He goes on to say that several more months have to pass before we can be certain of these impacts, but that

“it is becoming clearer that the impact cannot be dismissed as temporary.”

Does the Minister agree? Is he proposing to set in hand immediately a review of how these problems can be mitigated?

[Lord Frost (Con)]

My Lords, I looked at the CER report with a lot of interest. It is one in a series of reports that has, I think, been subject to some methodological debate, at least. I am not sure I personally think it entirely valid to set up a kind of mock economy based on other parallel economies and draw conclusions from that, which I understand to be the methodology. I do not think we dispute that there have been changes in trade patterns in recent months, but as the ONS said in its report published on Tuesday:

“It is difficult to fully detangle the impact the coronavirus and EU exit had on UK and international trade while they are still having an influence.”


That remains the case.

[Baroness Ludford (LD) [V]]

Can the Minister include, in any assessments he can be persuaded to carry out, the loss of EU nationals in sectors such as horticulture and social care? It is reported that workers may be brought in from Belarus and Russia to pick our fruit and veg, in replacement for EU nationals. Can he rule that out? Do the Government not think it better to invite some of the EU nationals back to help us in those sectors, rather than let them be detained and deported when they come for a job interview, as permitted under the Immigration Rules?

[Lord Frost (Con)]

My Lords, one of the great benefits of ceasing to be a member of the European Union was that we could establish our own immigration system, and indeed we have done so, on the basis of the points-based system that has been extensively discussed and implemented. The advantage of that is that it gives us control of who we wish to let enter the country, either temporarily or permanently. Obviously, when we make that assessment we look at the industries, the economics and the broader situation. We will continue to do so when we make those judgments.

[Baroness Hayter of Kentish Town (Lab)]

The Minister and the Prime Minister seem to claim that they did not know quite what the protocol would imply and how tricky it would be to make it work. In front of our European committee last week, the Minister confessed that he was a bit surprised about how disruptive it was, and said it could remain

“a bit bumpy … for some months”.

Is it possible that, because the vigorous work was not done before that protocol was signed, he is surprised by the implications of it? Even now, it might be helpful if he publishes the legal advice that was available at the time.

My other question is this. Given that there are still very many decisions to be taken, both by the Government in implementing the agreement and together with the EU in the Partnership Council, can he undertake that there will be proper impact assessments before big decisions are made and that these will be published and discussed widely, so that he has the benefit of the wisdom of Charles Grant and others before big decisions are taken?

[Lord Frost (Con)]

My Lords, on the Northern Ireland protocol, the issue is that the protocol is a very delicately balanced document designed to support a very delicately balanced agreement—that is, the Belfast/Good Friday agreement. When the protocol is implemented it needs to have regard to that balance and the set of provisions that try to protect this delicately balanced situation. At the moment, in our view, the protocol is not being implemented in a way that reflects that balance. It does not reflect the full dimensions of the Good Friday agreement, east-west and north-south, and that is at the root of the difficulty. That is not what we expected when we agreed it, but we still hope that we can get into that situation in discussions with the EU in the weeks and months to come.

On future impact assessments, when legislation is needed to implement reforms or changes, whether these result from the TCA or from anything else, there will of course be an impact assessment. That is the usual practice.

[Lord Lamont of Lerwick (Con) [V]]

Does my noble friend agree that it is absurd to attempt to measure the impact of Brexit in such a short term, as suggested by the noble Lord, Lord Purvis, and others, and that other factors will be difficult to separate from Brexit? Above all, new policies, whether they be domestic policies or trade agreements, take time to build up, and the impact of Brexit over one year, five years or 15 years will be very different. Do all these questions not sound suspiciously like attempts to rerun the Brexit referendum, and is it not time that we all recognised that the result has to be accepted and we should move on?

[Lord Frost (Con)]

I agree with my noble friend. These questions have been extensively debated over the last five years and the range of views on that subject has possibly not changed significantly over that period. Our view is that the medium-term benefits of being a full democracy, of having control over our own laws and regulations and having the ability to tailor them to our own requirements as a country, will be of huge benefit to us, so we are very confident that those benefits will materialise. However, he is right that five months after the end of the transition period is a bit soon to be 100% clear about that.

[The Deputy Speaker (Lord Faulkner of Worcester) (Lab)]

My Lords, all supplementary questions have been asked.

UK–EU Trade and Co-operation Agreement: Meetings of Bodies

Lord Frost Excerpts

Thursday 27th May 2021 Lords Chamber

[The Earl of Kinnoull]

To ask the Minister of State at the Cabinet Office (Lord Frost) which of the 24 bodies set up under the United Kingdom–European Union Trade and Cooperation Agreement met in May; and how many are anticipated to have met by the end of June.

[The Minister of State, Cabinet Office (Lord Frost) (Con)]

My Lords, now that the trade and co-operation agreement has been ratified, its committees and other bodies can indeed begin their work. None has met so far, but we will agree the date for the first meeting of each of those bodies with the EU shortly. We expect most to meet before the summer break. We also expect to fix a date for the first partnership council meeting, which is likely to be in the first half of June.

[The Earl of Kinnoull (CB)]

My Lords, the TCA will be six months old at the end of June, and to hear of the lack of activity is dispiriting. Its multi-layered governance structure is incredibly important to getting the parties to iron out the problems, and to discussing the next layer down of the detail of the new relationship. Can the Minister tell the House by when all the bodies will have members appointed, and will he commit to publishing monthly basic statistics on the number of meetings taking place, to demonstrate activity?

--- Later in debate ---

[Lord Frost (Con)]

My Lords, I agree that it is extremely important that all the bodies created under the trade and co-operation agreement should meet and work effectively. I can assure the noble Lord that there has been no lack of activity between me and my EU opposite numbers and our teams during this period, but I agree that it will produce stability when the committees are working properly. We will do everything we can to ensure that there is good transparency about meetings and what is discussed.

[Lord Wood of Anfield (Lab)]

My Lords, when the Minister resumes partnership meetings with the EU, presumably the Northern Ireland protocol will be at the top of the agenda. Can he tell us what his response is to the remark by the President of the European Commission on Monday, that the protocol is the

“only possible solution to ensure peace and stability in Northern Ireland while protecting the integrity of the EU single market”?

As the co-architect of the protocol, does he accept responsibility for its consequences, which were widely predicted, and which now seem to trouble him, too, so much?

[Lord Frost (Con)]

My Lords, the question of the Northern Ireland protocol will, I am sure, be on the agenda of the joint committee when that meets, which should be at approximately the same time—in the first half of June. We have noted the comments of the Commission president earlier this week. The protocol relies on the support of all communities in Northern Ireland, so it is disappointing that there was not more recognition by her of the impact that its operation is having there—but we continue the discussions and hope to be able to find pragmatic solutions.

[Lord Moylan (Con)]

My Lords, is my noble friend aware that many noble Lords are rather relieved that this plethora of committees remains inoperative? They are wholly disproportionate to a trade agreement, and we do not see the need for them, or for the expense of the caravan of secretariats that they will no doubt bring with them. Does my noble friend agree to make it an objective of British government policy in his current discussions that their number and scope of activity be radically reduced?

[Lord Frost (Con)]

My Lords, I share my noble friend’s distaste for bureaucracy in all its forms, even though I have spent most of my life working in one. It is, unfortunately, a characteristic of international relations nowadays that there is a substantial bureaucratic component, and we have to work with that. I hope that the various committees that have been created will help us to resolve problems. I can reassure my noble friends that the bureaucracy is, at least, much less than when we were a member of the European Union.

[Lord Wallace of Saltaire (LD)]

My Lords, is it the Government’s objective, nevertheless, to get the full panoply of relations and committees working well, as we have to manage a very wide agenda of continuing close relations with the European Union? Do the Government have it in mind that they could take the Swiss option, as it were, and break the series of complex negotiations and treaties that they have with the EU—which, as he will know, the Swiss have just done?

--- Later in debate ---

[Lord Frost (Con)]

The noble Lord is right, in that the trade and co-operation agreement is an extremely broad treaty, with a very wide agenda. That is why it requires so many committees to make it work. I can reassure him that it is certainly our objective to make sure that the committees work, and that they meet, if at all possible, before the summer break. We have already exchanged with the EU lists of chairs of the committees, and I am confident that we will move forward fairly quickly on all this.

[Baroness McIntosh of Pickering (Con)]

Does my noble friend agree that if the trade specialised committee on SPS measures had been set up and had actually met, we might be in a better place as regards cross-border trade issues between Great Britain and Northern Ireland, and between the UK and the EU? Will he endeavour to ensure that it meets at least once before the end of June, to resolve these issues?

[Lord Frost (Con)]

My Lords, unfortunately, I am not sure that I agree with my noble friend that we would be in a significantly different position if that committee had met. There have been quite a lot of discussions on SPS issues in various contexts over the past few months, although the committee has not met formally, and we have not managed to find constructive agreements on that subject—although we keep trying. I am confident that the committee will meet before the summer break, and of course we continue to discuss these matters extensively with the EU.

[Baroness Wheatcroft (CB)]

My Lords, in negotiating the TCA, the UK Government succeeded in putting the UK’s extradition arrangements with the EU on a similar unbalanced footing to those with the US. We continue to extradite to the EU, but 20 EU countries will not extradite directly here. Are negotiations going on to try to rectify that?

[Lord Frost (Con)]

My Lords, extradition arrangements were indeed the subject of quite a large part of the negotiations, and in our view—the Government’s view—the agreement that we reached with the EU deals with many of the defects that were present in the earlier European arrest warrant system. It is part of the standard way in which extradition arrangements work that member states can, in certain circumstances, refuse to extradite their own nationals, and some member states have made that clear. We continue to discuss this issue with the Commission and all the member states concerned.

[Baroness Hayter of Kentish Town (Lab)]

My Lords, the multi-layered governance structure mentioned by the noble Earl is not the only thing that needs to be set up under the TCA. The civil society forum and the domestic advisory group are vital channels into Government, and the partnership council decisions. The UK cannot by itself set up the joint forum, but it can—and surely should—establish a domestic advisory group to feed into the forum. Can the Minister, who is responsible for getting this going, tell us the date when that will happen, and assure us that preparations go a little beyond what he referred to in his Written Answer to me this week—just to

“engage with business and civil society”?

I think it is time for action now.

--- Later in debate ---

[Lord Frost (Con)]

My Lords, the TCA provides for a civil society forum. It has to be balanced between UK and EU business and civil society groups to discuss the implementation of the agreement. We are in touch with the EU about how this will work. We will work very much to facilitate its first meeting this year. We are engaging actively with business and civil society domestically, and I am happy to write to the noble Baroness about the detail of where that has got to.

[Lord Jones of Cheltenham (LD) [V]]

Is the noble Lord making any progress on negotiating a new deal for the creative sector on touring in Europe? While he is thinking of a plausible answer to that, can he tell us whether, when he decided to reject the EU’s generous offer in the negotiations and throw touring musicians under a bus, he anticipated, is surprised by, or accepts any responsibility at all for the humiliation of our country scoring zero—nul points—in the Eurovision Song Contest?

[Lord Frost (Con)]

My Lords, I am happy to accept responsibility for many things but I do not think I can reasonably accept that I affected the result on Saturday night. As regards creatives, of course we work to support all our creative industries in the situation that now prevails under the TCA. We made proposals in the negotiations that would have largely solved the difficulties faced by our great creative industries. The proposals made by the EU would not have done so, so we would be in this situation. We are now working as hard as we possibly can with the member states to establish the facts about visas and to support our industry in moving forward.

[The Deputy Speaker (Lord Faulkner of Worcester) (Lab)]

My Lords, the time allowed for this Question has elapsed.